OUR VIEW: The right call on exchanges

Published: Sunday, November 25, 2012 at 6:01 a.m.

Last Modified: Friday, November 23, 2012 at 5:59 p.m.

Gov. Robert Bentley last week defended his decisions not to create a state health insurance exchange or expand Medicaid under provisions of Obamacare (we know it’s officially the Patient Protection and Affordable Care Act, but even the White House now uses that nickname).

We appreciate his desire to convince people he did the right thing; it’s in a politician’s nature. However, Bentley’s decisions stand for themselves, and we think they were correct from the get-go, especially the one on health insurance exchanges. And it’s not just because most Alabamians oppose Obamacare, as reflected in the easy victory Nov. 6 of a constitutional amendment barring participating in a mandatory health-care system.

The idea behind health insurance exchanges sounds like a good one: Create a marketplace in which individuals and small businesses could shop around to find more affordable insurance policies.

Under Obamacare, most U.S. citizens must have health insurance by 2014 or be subject to fines. Individuals at certain income levels would be eligible for premium subsidies.

States can either create their own exchanges or launch them in partnership with the federal government. The feds will set up and administer exchanges in the states that don’t.

Bentley once spoke positively of such exchanges. We recently said if Alabama must have an exchange, officials here should have a say in its creation and administration.

However, Bentley said “state-run” exchanges under Obamacare are anything but, because they would have no real flexibility under federal mandates and regulations.

And while supporters of Obamacare have touted the fact that exchanges are a “conservative idea,” which originated with the Heritage Foundation, representatives of that group have condemned this plan. They said the original concept called for individually state-designed and state-managed exchanges, not anything controlled by Washington or that requires standardized benefits across the U.S.

There’s also the price tag. Bentley said operating an exchange would cost Alabama $30 million to $50 million. Officials in other states have tagged the cost higher, maybe even into nine figures. The federal government would subsidize the first year of state-created exchanges. Afterward, states would be on their own. Supporters say a premium tax could be charged on participating insurers to fund exchanges. Opponents think taxes eventually would have to be raised on state residents. Either would be a tough sell.

Bentley isn’t alone on this island. As of Nov. 20, 20 states had chosen not to establish exchanges. All have Republican governors, and some have charged this is a back-door assault on Obamacare by people who can’t accept the Nov. 6 election results — that these governors are hoping, if the feds have to set up so many exchanges, the whole thing will implode.

That’s possible, although we try not to be Machiavellian without good cause. Or maybe it’s a case of people who have to balance budgets realizing that just because a policy was adopted with good intentions and the notion that it will help someone doesn’t mean it will work in the real world.

<p>Gov. Robert Bentley last week defended his decisions not to create a state health insurance exchange or expand Medicaid under provisions of Obamacare (we know it's officially the Patient Protection and Affordable Care Act, but even the White House now uses that nickname).</p><p>We appreciate his desire to convince people he did the right thing; it's in a politician's nature. However, Bentley's decisions stand for themselves, and we think they were correct from the get-go, especially the one on health insurance exchanges. And it's not just because most Alabamians oppose Obamacare, as reflected in the easy victory Nov. 6 of a constitutional amendment barring participating in a mandatory health-care system.</p><p>The idea behind health insurance exchanges sounds like a good one: Create a marketplace in which individuals and small businesses could shop around to find more affordable insurance policies.</p><p>Under Obamacare, most U.S. citizens must have health insurance by 2014 or be subject to fines. Individuals at certain income levels would be eligible for premium subsidies.</p><p>States can either create their own exchanges or launch them in partnership with the federal government. The feds will set up and administer exchanges in the states that don't.</p><p>Bentley once spoke positively of such exchanges. We recently said if Alabama must have an exchange, officials here should have a say in its creation and administration.</p><p>However, Bentley said “state-run” exchanges under Obamacare are anything but, because they would have no real flexibility under federal mandates and regulations.</p><p>And while supporters of Obamacare have touted the fact that exchanges are a “conservative idea,” which originated with the Heritage Foundation, representatives of that group have condemned this plan. They said the original concept called for individually state-designed and state-managed exchanges, not anything controlled by Washington or that requires standardized benefits across the U.S.</p><p>There's also the price tag. Bentley said operating an exchange would cost Alabama $30 million to $50 million. Officials in other states have tagged the cost higher, maybe even into nine figures. The federal government would subsidize the first year of state-created exchanges. Afterward, states would be on their own. Supporters say a premium tax could be charged on participating insurers to fund exchanges. Opponents think taxes eventually would have to be raised on state residents. Either would be a tough sell.</p><p>Bentley isn't alone on this island. As of Nov. 20, 20 states had chosen not to establish exchanges. All have Republican governors, and some have charged this is a back-door assault on Obamacare by people who can't accept the Nov. 6 election results — that these governors are hoping, if the feds have to set up so many exchanges, the whole thing will implode.</p><p>That's possible, although we try not to be Machiavellian without good cause. Or maybe it's a case of people who have to balance budgets realizing that just because a policy was adopted with good intentions and the notion that it will help someone doesn't mean it will work in the real world.</p>